US financial firms view compliance with the Basel II accord as the most important area of risk management in their company, according to a recent industry survey.
The Risk Capital 2006 survey, produced by the International Centre for Business Information (ICBI), found that regulatory compliance was rated as a "key catalyst of risk management" for 39 per cent of firms questioned, more than for any other option in the questionnaire.
The findings will be good news for those championing the new Basel accord, which provides rules for banks and other financial institutions that will protect them against large-scale market crashes in the future.
Although the accord is due to be implemented globally by 2008, firms in many countries have already expressed reservations about being compliant with the new regulations on time, including India and China.
Despite Basel II being a priority for many US firms, the survey also showed that only 71 per cent of the US institutions were confident that they would be compliant with Basel II by the deadline, with many seeing compliance as a major challenge faced by their company in the coming years.